Insider Tips on Tax Season for Small Businesses

This is a guest post by Mahima Chawla, Business Development Manager at Bond Street.

Quick Tips To Prepare For Tax Season

Most importantly, make sure you track everything including every business revenue and expense (ideally dated).

Here are some points to take note of as you prepare for filing:

• Use an an accounting system. Whether this is Excel or one of the numerous free and cheap automated accounting softwares catered to small businesses, ensure that you have a process in place.
• Take note of your filing schedule. Different business entities have different dates for filing taxes. To understand the timeline for your business type, you can check the IRS tax calendar.
• Make sure to separate business expenses from personal expenses. Consider setting up a separate legal entity, open business accounts and implement an accounting system, and, at the very least, use a different credit/debit card to track business expenses.
• Look into hiring a CPA. An accountant can maximize your credits and deductions. Use an online database to get connected with accounting professionals in your area.
• Take advantage of tax credits. The IRS has a mobile app for help and information on this called IRS2Go.
• Avoid common audit traps. Label each deduction, don’t classify employees as independent contractors, and file the correct forms for contractors, to name a few common mistakes.
• Be aware of deductions you qualify for. Common tax deductions for small businesses include start-up expenses, vehicle, business travel. home office, and health care premiums. There are many more...

See even more tips in part 2 of this blog series.